What Can Be Learned from the Republican Spending Orgy in Texas?

As shown by the lack of spending restraint in Trump’s absurdly named One Big Beautiful Bill. there are plenty of big-government Republicans in Washington.

At the risk of understatement, they are not complying with the Golden Rule of fiscal policy.

What might surprise readers, however, is to learn that there are also plenty of big-government Republicans in Texas.

How many?

Enough to make some experts wonder whether there is much difference between Texas Republicans and California Democrats. Here are some excerpts from Vance Ginn’s recent analysis.

…lawmakers are preparing to pass a $337 billion budget for 2026–27, with state funds up 42.8% since 2022. That’s not “conservative governing”—that’s runaway progressive budgeting with an R next to it. This moment is especially troubling because Texas had every advantage: a booming economy, a $24 billion surplus, and $28 billion parked in the Rainy Day Fund. Yet from the outset, the political appetite was clear—not to return excess funds to taxpayers, but to spend, expand, ban, and centralize. Of that massive surplus, only about $6.5 billion is going to tax relief, and only about $3.5 billion in new relief that wasn’t already in law. The rest is poured into bloated agencies, corporate handouts, and vote-buying schemes that defy every principle of responsible budgeting.

While the most recent budget is very disappointing, GOP profligacy in the Lon Star State is hardly a new phenomenon.

Here’s a chart Vance shared in another one of his recent articles.

Returning to Vance’s original article, he zeroes in on the real problem, which is that there’s not an effective cap on spending growth.

What’s most frustrating is that all of this could have been avoided. The Sustainable Budget Project lays out a clear path forward: tie budget growth to population plus inflation—a principle that matches government growth with the average taxpayer’s ability to fund it. Had lawmakers followed this rule, we could have prevented overspending, driven down taxes… This session may go down as the most progressive in Texas history, not because Democrats were in control… We must adopt a strong constitutional spending limit that applies to all state and local spending, closes every property tax limit loophole, and requires a supermajority to exceed the limit.

What makes a spending cap so vital is that a state that has relatively good economic policy (Texas ranks #5 according to Economic Freedom of North America and ranks #6 according to Freedom in the Fifty States) is going to enjoy good growth.

And good growth will generate plenty of tax revenue (not income tax revenue since Texas has never made the mistake of adopting an income tax, but other tax revenues have grown rapidly because of more economic activity).

The problem, as Vance explained above, is that politicians have a hard time letting go of this extra revenue. Which is why a spending cap so important.

Indeed, it’s worth noting that some of the scholarly research on spending caps notes that they are effective for exactly this reason. They prevent politicians from spending windfall revenues.

The bottom line is that Texas needs a Colorado-style spending cap that restricts the budget so it can grow no faster than population plus inflation.

And government spending is the problem. Limit government and the symptoms of tax increases and more debt will go away.

P.S. The above analysis applies to countries (Greece, Barbados, France, Finland, Brazil, Colombia, and the United Kingdom), to states and provinces (Alaska, Puerto Rico, Alberta, Washington, Western Australia, Maryland, and California), and to local governments (New York City and Fairfax County).